Author
Listed:
- Weill, Peter
- Woodham, Richard
Abstract
Firms achieving above industry average returns from IT investments must be making consistently better IT-related decisions. Effective IT governance is one of the ways these firms achieve superior returns. Many firms are creating IT governance structures that encourage the behavior leading to achieving the firm's business performance goals. We define IT governance as specifying the decision rights and accountability framework to encourage desirable behavior in the use of IT. Effective IT governance requires careful analysis about who makes decisions and how decisions are made in at least four critical domains of IT: principles, infrastructure, architecture, and investment and prioritization. We studied the use of IT in large multi-business unit firms in the USA and Europe and found that the typical firm governs IT by following generally accepted guidelines with broad-based inputs and tightly controlled decision rights. However, top-performing firms governed IT differently with governance structures linked to the performance measure on which they excelled (e.g., growth). Designing an effective IT governance structure requires understanding the competing forces in a large organization and creating harmony among business objectives, governance archetype and business performance goals. An effective IT governance structure is the single most important predictor of getting value from IT. To help understand and design more effective governance, we propose an IT governance framework that specifies how decisions are made in the key IT domains. The framework harmonizes desired governance archetypes (i.e., monarchy, feudal, federal and anarchy) and a series of governance mechanisms (e.g., committees, approval processes and organizational forms). The framework is illustrated with effective IT governance at State Street Corporation. Effective IT governance encourages and leverages the ingenuity of all the firm's people in using IT, not just the leaders, while still ensuring compliance with the firm's overall vision and principles. In short, don't just lead, govern
Suggested Citation
Weill, Peter & Woodham, Richard, 2003.
"Don't Just Lead, Govern: Implementing Effective IT Governance,"
Working papers
4237-02, Massachusetts Institute of Technology (MIT), Sloan School of Management.
Handle:
RePEc:mit:sloanp:1846
Download full text from publisher
Corrections
All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mit:sloanp:1846. See general information about how to correct material in RePEc.
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
We have no bibliographic references for this item. You can help adding them by using this form .
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: None The email address of this maintainer does not seem to be valid anymore. Please ask None to update the entry or send us the correct address
(email available below). General contact details of provider: https://edirc.repec.org/data/ssmitus.html .
Please note that corrections may take a couple of weeks to filter through
the various RePEc services.